Microsoft estimates there are 1.2 million businesses of this size worldwide. Many of them have complex IT requirements. "Their infrastructures really rival those of enterprises," says Russ Madlener, director of product planning for the Windows Server solutions group. Microsoft's Small Business Server includes a number of different products installed together on one physical server, but medium-sized companies need more scale and better reliability than they can get with one server.

The product will be available in Standard and Premium edition. It will enable low-cost implementation and easy integration among several components for communication, security, and management and will also be extensible.